Deeds delays hurting RDP housing beneficiaries

Delays in registering title deeds for government-subsidised housing are denying over one-million beneficiaries an entry point into the formal property market, undermining their financial security, the FinMark Trust said this week.

It said research showed that only 1.44-million reconstruction and development programme (RDP) houses were registered at the Deeds Registry by September last year, while the Human Settlements Department indicated it had, or was busy constructing, 2.94-million houses at the time.

This implied that over one-million completed subsidy houses have not been registered on the deeds registry.

While it could mean that some houses were still under construction, FinMark Trust housing finance coordinator Kecia Rust told Engineering News Online that only about 200 000 RDP houses were probably in the construction phase during its research.

“Since 2004, the number of subsidised houses registered as a proportion of those reported delivered has plummeted, reaching a low of 17% in 2007,” Rust said.

Title deeds protect rights to a property and record changes in ownership. They provide individuals with an address, recognising the owner as being part of the municipality and enabling the owner to secure finance, or to bequeath the asset to family members.

The failure to provide title deeds meant beneficiaries were being denied a point of entry into the formal property market. Beneficiaries were not able to sell their houses formally and as a result, engage in informal transactions, which ultimately undermined the individual property owners’ tenure security and the integrity of the Deeds Registry in South Africa, Finmark stated.

“It appears that the decline in registration is linked to a change in the progress payment regime. In 2004, the requirement that title be transferred before payment was removed. It is also possible that from municipalities’ sides, the urgency for title is reduced in the face of the eight-year sale restriction on RDP housing, which was passed in 2001.

“If these houses had been registered, the 2.94-million houses would comprise about 39% of the entire residential property market,” the research pointed out.

Meanwhile, the research found that government-subsidised housing was valuable to beneficiaries and was having a profound impact on the growth of local economies and sustainable human settlements across South Africa.

While the financial asset value of houses was overlooked by the majority of households, a significant minority were using their homes to gear finance. Between 1994 and 2010, 120 000 mortgage loans were issued against subsidised housing, and 90 858 have even sold their homes and purchased second properties.

“Even at these small proportions, the extent of finance mobilised by these assets is not insignificant. Subsidised properties have been used to secure roughly R20-billion in mortgage finance, signifying that the government-subsidised housing market is slowly beginning to resemble a normal market,” Rust said.

By matching subsidy applicants with properties, a total of 1.7-million subsidy applicants were identified as property owners of 1.44-million properties. Just under half of these properties were found to be located in the eight metropolitan cities, with the highest number of registrations across the provinces found in Gauteng at 395 765, the Eastern Cape at 238 682 and the Western Cape at 208 852.

Updated 6 hours ago
The Development Bank of Southern Africa (DBSA), through its Infrastructure Delivery division, has signed memorandums of agreement with the South African Federation of Civil Engineering Contractors (Safcec) and the Black Business Council Built Environment (BBCBE) to...

By: Terence CreamerUpdated 7 hours ago
The Gauteng government has set aside R10-billion of its R95.3-billion 2015/16 budget to fund its five development corridors, which are being pursued across the so-called ‘City Region’. Gauteng, which is South Africa’s smallest province by area, is also the country...

By: Terence Creamer
Finance Minister Nhlanhla Nene has acknowledged that South Africa requires “much higher levels of economic growth” to address unemployment and poverty. He also stresses that any economic expansion would need to be supported by the accelerated implementation of the...

Updated 5 hours ago
Transport equipment manufacturer GE Transportation has appointed Thomas Konditi as the head of its sub-Saharan Africa division. Konditi, who would be based in Johannesburg, was most recently COO of GE Africa, in Nairobi. His responsibilities included the oversight of...

By: Megan van WyngaardtUpdated 5 hours ago
Trade union Solidarity has criticised the Nuclear Energy Corporation of South Africa (Necsa) for continuing with a restructuring process, which the union claims results in employees being demoted, without consulting with Solidarity about the process. Solidarity...

By: Natasha OdendaalUpdated 5 hours ago
South Africa’s Automotive Production and Development Programme (APDP) had boosted Ford Motor Company of Southern Africa’s (FMCSA’s) manufacturing competiveness, the vehicle manufacturer said on Tuesday. The Department of Trade and Industry (DTI) had introduced the...

Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...

Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...

Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.

Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...

Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...

Updated 6 hours ago
Eqstra Holdings was going to reduce its exposure to contract mining, but it was not yet ready to sell the troubled business, said CEO Walter Hill on Tuesday. He said Eqstra would not sell its contract mining business in a “depressed market”. He said it would be...

Subscribe to Engineering News and Mining Weekly for two years, but only pay for the first year. The weekly editions of Engineering News and Mining Weekly will be posted to your preferred postal address and also gain access to:

National flag carrier South African Airways (SAA) is in an advanced stage of renegotiating its deal with European airliner manufacturer Airbus to acquire A320 single-aisle (or narrow body) aircraft. The aim is to replace ten of the aircraft still on order with five...

Worldwide, the main thrust in the ports industry over the past decade or more has been to increase efficiency. Traditionally, ports have been run by engineers and mariners and, in the past, increasing a port’s capacity was achieved by expanding the harbour. “That has...

What do you do when an elephant has a toothache? You call Dr Gerhard Steenkamp from the University of Pretoria’s (UP’s) faculty of veterinary science, Onderstepoort, one of only two elephant ‘dentists’ in the world.